Dublin / New York, November 1, 2023
In today's volatile financial environment, fund managers are constantly vigilant about potential risks, with currency risk standing out prominently. Centaur, in collaboration with its strategic partner, Corpay, offers robust Foreign Exchange solutions tailored to the intricate needs of fund managers.
Why Do Fund Managers use FX Hedging Strategies?
Currency fluctuations can play havoc on investment returns. To shield against this unpredictability, fund managers adopt FX hedging strategies. By doing so, they can:
- Mitigate Currency Risk: FX strategies can provide protection against unfavourable currency fluctuations, enabling fund managers to navigate market unpredictability.
- Achieve Stable Returns: With minimized currency risk, fund managers can better align their portfolios to intended performance outcomes.
- Fulfil Fiduciary Duties: For many funds, an FX strategy isn't just a choice — it's a fundamental aspect of fiduciary duties.
- Enhance Fund Performance: A well-implemented FX strategy can uncover opportunities for portfolio enhancement and highlight areas for improvement.
- Attract New Capital: Demonstrating a proactive approach to risk can make funds more appealing to potential investors.
Centaur's partnership with Corpay equips fund managers with a suite of tools and services that address FX concerns head-on:
- Competitive Execution: Get the best FX rates with reduced hedging costs.
- Efficient Onboarding: Streamlined processes ensure you're up and running swiftly.
- Rapid Payments: Experience fast-tracked payments using SWIFT GPI.
- Short-Term Hedging: Ideal for acquisitions and sales, this strategy allows fund managers to mitigate FX volatility and maintain a consistent trajectory.
- Long-Term Portfolio Hedging: Targeted at sustaining stable growth, it removes FX volatility from entry value and overall portfolio growth.
- Bespoke Credit Facilities: Manage liquidity risks during hedging with tailored credit solutions.
- Cutting-Edge Platform: An award-winning online trading platform, complemented by live MTM and EMIR regulatory reporting.
- Counterparty Risk Diversification: Spread your risk by integrating our solutions with multiple counterparties.
- Proactive Insights: Stay informed with regular market insights and a dedicated service team.
Treasury and Risk Management
Corpay goes beyond just providing FX solutions. Their dedicated teams:
- Assess FX Risks: They pinpoint where the FX vulnerabilities lie, both short-term and long-term.
- Craft Tailored Strategies: Post risk-assessment, they work hand-in-hand with clients to create risk-reducing strategies, taking into account the fund's objectives and suitable products.
- Offer Option Products: Utilized alongside Spot Transactions and Forward Contracts, these play a pivotal role in a comprehensive FX hedging strategy.
Fund managers cannot afford to overlook the profound impact of currency movements on their portfolios. With Centaur’s FX Services they're empowered with tools, insights, and strategies to turn currency volatility from a challenge into an opportunity.